We lead on price and differentiate on surprise: offering our customers affordable everyday products. ... Customers in th
UPDATE
2016
CONTENTS INTRODUCTION
5
ACTION
6
Our unique retail format
7
Our ambition
7
Our history
8
Highlights 2016
9
Our customers
11
Our people
13
Our stores
14
Our products
17
SOCIAL RESPONSIBILITY: ACTION!
18
Our products are safe and responsibly sourced
21
We are a responsible employer
23
We minimise our environmental impact across the supply chain
24
We contribute to society and serve local communities
25
GOVERNANCE
26
RISK MANAGEMENT
27
OUR KEY FINANCIAL FIGURES
27
3
4
INTRODUCTION At Action, we “do” and we did a lot in the year 2016. We had a record-breaking year, with a sales growth of 34%, while opening 197 stores in Austria, Belgium, France, Germany, Luxembourg and the Netherlands. At year-end, we had a total of 852 stores, employing over 35,000 people. Action is a fast-growing, international non-food discount retailer with a simple and successful business model. We lead on price and differentiate on surprise: offering our customers affordable everyday products. We offer over 6,000 different items, adding more than 150 new products per week. Our range includes an increasing number of A-brands and surprising private label products. We focus on quality, sustainability and transparency every day. For Action, social responsibility comes naturally. It is something we do but not something we regularly talk about. It means doing business, while behaving responsibly. We want to get even better at what we do. As an important customer, employer and retailer, we are committed to maintaining a sustainable supply chain with quality products. We are continuously striving to make our customers happy. In 2016, we were elected European Retailer of the Year for the third consecutive year. The combination of an attractive shopping environment, friendly and motivated staff plus a wide and ever-changing range of products at the lowest possible prices is what makes Action a unique retail formula. In 2016, customer loyalty strengthened further. Our employees play a crucial role in making this happen, through their hard work and dedication every day. Together, we make Action. It makes me very proud to be part of this company and I would like to thank each and every one of my 35,000 colleagues for their efforts to offer our customers more than they expect for less than they imagine. Sander van der Laan, CEO
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ACTION We are Action. Europe’s fastest growing non-food discounter with more than 850 stores in six countries. It all started 24 years ago with a single store in Enkhuizen in the Netherlands. The founders wanted to surprise people with a wide range of products at the lowest possible prices. And this is what still excites us every single day: making a difference by selling a surprising, ever-changing range of products at incredibly low prices. “More than you expect for less than you imagine”: that is our promise to our customers. Our brand stands for surprise, the lowest price and for simplicity. The simplest way is usually the best. We are called Action for a reason. We are do-ers. Our no-nonsense ‘getting things done’ mentality is our key strength. At Action, we realise that people do not buy low prices, they buy products. Products that make their lives easier, better and more fun. Products that add value to their lives. Thanks to our strong network of suppliers, we can offer a wide range of items for everyday life at unbelievably low prices. We provide good quality at a low price: products that perform as expected, for unexpected prices. We provide the best value for money. Despite our low prices, we make no concessions to the quality of our products. They all meet the relevant requirements in each of the countries where we operate. Action wants to sell products that meet customer expectations. If we cannot offer the lowest possible price and if we cannot supply good quality, we choose not to sell those products in our stores. We have once again proven how successful our business model can be, and not just through our strong financial performance and continued business growth. Last year, Action won the Retailer of the Year Europe award for the third year in a row.
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OUR UNIQUE RETAIL FORMAT At Action, we like to keep it simple. We focus on a single formula for all our stores. A formula characterised by quality, simplicity and surprise. This unique Action formula can be found in every Action store around Europe. We operate more than 850 stores in the Netherlands, Belgium, France, Germany, Luxembourg and Austria. In each store we offer a wide, surprising and ever-changing product range, with more than 6,000 different products at the lowest possible prices. We can offer these prices thanks to our scale and our highly efficient supply chain. We buy in very large volumes, and cost-consciousness is engrained in our business culture. Only a third of our assortment is fixed year-round and over two-thirds is constantly changing. We introduce over 150 new products every single week. Our product range consists of 13 categories. Our stores are stocked daily from our distribution centres in the Netherlands and France.
WHY OUR PRICES ARE LOW S imple business model ow overhead L costs
Low marketing expenditures
We buy big volumes
E VERY PURCHASEAND COST BENEFIT FOR OUR CUSTOMERS
S tandardised store processes
No fixed assortment
Efficient logistics
Stores at B/C locations
OUR AMBITION In the end, everyone loves a pleasant surprise, no matter who they are or where they come from. Customers in the Netherlands, Belgium, France, Germany, Luxembourg and Austria already have access to what we call the ‘magic of Action’, but there are still many places and people in Europe we want to reach in the future, by using our unique strengths of simplicity and a straightforward approach. We focus on a simple, scalable and cost-effective business model to strengthen our unique customer value proposition. We want to offer good quality for the lowest price to as
many people as possible. This approach has taken us a long way and can take us even further. We are expanding rapidly and want to continue to do so. The more we grow, the higher the volumes we can achieve, and the more value and variety we can offer our customers. We focus on a sustainable value chain and quality products. Thanks to a wide and ever-changing range of products, Action offers an element of surprise to its consumers and achieves remarkable customer loyalty.
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OUR HISTORY
1993
1995
Opening 1st store
Purchase 1st truck
in Enkhuizen, the Netherlands
1997 1994 Action has 8 stores
2003
Action’s 1st own warehouse
1999
2002
Opening 100th store
and office in Medemblik
Opening of distribution centre
36 store openings
(1800m2)
in Zwaagdijk-Oost
in one year
New head office and expansion of distribution centre in Zwaagdijk-Oost
2008
2004
Opening 200th store
Introduction of supermarket concept
2005 Commissioning of double-decker trailers 1st store in Belgium
2009 1st store in Germany
2010 Expansion of distribution centre to 100.000 m2 (16 football fields)
2011
2012
2013
2014
2015
Acquisition by investor 3i
1st store in France
Opening 400th store
Opening 500th store
Opening 100th store
Ria’s fan page
20 years
Echt distribution
on Facebook
of Action
centre made
in France
online
1st store in Austria
operational 1st store in Luxembourg
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HIGHLIGHTS 2016 Opening of 3rd distribution
Opening 100th
Opening 200th
centre, in Moissy-Cramayel,
German store
French store
first DC in France
Opening 750th store
winkels 750+ winkels
TASSEN SURPRISE EN!
KRASS
MAAK KANS OP
2016 - 2017
75
€ €
SHOP 50 TEGOED
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SHOP ED TEGO
vier met ons mee
LIMITED EDITION BIG SHOPPER
WW
1099_Action750_Leaflet_A5_Voorkant_NL.indd 1
750+
toys - department store - overall
department store - household - overall
decoration - discount store
decoration & gifts
GA NAAR WWW.ACTION.EU/750 KIJK VOOR DE ACTIEVOORWAARDEN OP ONZE SITE
9702858
! WIN S EN KRAW.A /750 CTION.EU
3th consecutive time winner Retailer of the Year Europe
16-09-16 15:33
flyer
winkels
vier met ons mee
TASSEN SURPRISE EN!
KRASS
MAAK KANS OP
75
€
9702872
pavement sign
16-09-16 17:03
SHOP 50 TEGOED €
7
750+ winkels
SHOP ED TEGO
vier met ons mee
LIMITED EDITION BIG SHOPPER
IN! EN W KRAW.SACTIO N.EU/750
GA NAAR WWW.ACTION.EU/750 KIJK VOOR DE ACTIEVOORWAARDEN OP ONZE SITE
WW
1099_Action750_Leaflet_A5_Voorkant_NL.indd 1
check-out sign
9 9702858
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OUR CUSTOMERS In 2016, Action welcomed millions of shoppers every week. Our customers come from every part of society. People with different backgrounds, different mindsets and different reasons to visit our stores. As we enter new markets and develop existing ones, it will be even more important to acknowledge this diverse range of customers and the reasons they shop at Action stores. Some are looking for bargains, while others just enjoy treasure hunting; but one thing they all like is the element of surprise thanks to unexpected products and unexpected prices.
sustainability or price? When are they happy and satisfied? They visit our stores for the low prices and our wide and surprising range of products. More than half of the people shopping at Action arrive home with more products than they initially planned to buy. Another reason they visit us is the good price-quality balance. We sell products that meet our customers’ expectations. We know that our customers usually take their time when they visit Action, so they don’t miss out on any interesting new products. That is why we focus on making the customer journey as pleasant and comfortable as possible in an Action way.
Everything we do is designed to deliver more value for our customers. Value in the items they can buy, and in the experience of shopping at Action. It is this overall customer experience that drives us every single day. Every decision we make is based on what our customers expect from us. What are their expectations when it comes to quality,
Our customers don’t just visit our stores on a regular basis. They also visit us online. Our websites attract an increasing number of visitors every month. Here they can find our weekly special offers and a top 100 of newly introduced products. Our digital newsletter with special Action offers is sent to more and more subscribers every week.
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OUR PEOPLE At Action, everything we do is designed to ensure happy and satisfied customers. Our employees play an important role in achieving this. Their enthusiasm and commitment are crucial to the success of our company. Our Action formula, driven by simplicity, scale and surprising value, is powerful, but it only works because we can rely on the dedication and hard work of the people working for Action. Our employees help us to continue to strengthen our position as Europe’s fastest growing non-food discounter, and without them we would not have become Retailer of the Year Europe for three years in a row. They are the ones helping our customers find their way through our stores every day, and adding to our customers’ shopping experience.
We added another 6,000 people to our workforce last year, taking our total to 35,000 employees. We are rapidly expanding on an international level, and our workforce is growing quickly, in terms of both the number of people and diversity. Our people may come from a diverse range of backgrounds and have a varied range of talents, but two things they all share are a passion for retail and a no-nonsense getting-things-done mentality. Our company culture is built on our values: customer-focus, cost-consciousness, simplicity, discipline, teamwork and respect. These values are the backbone of our organisation. We rely on each other and work together to create a positive working atmosphere. These are the values that are fundamental to our success, and serve as the basis of our highly selective search for new people.
Aantal medewerkers totaal Total number of employees
(rounded in fivehundreds)
35,000
35,000
29,000
30,000
22,000
25,000 20,000 15,000 10,000
16,500 11,500
5,000 0
2012
2013
2014
2015
2016
13
OUR STORES It is not just about what is on our shelves. We want to offer our customers a convenient shopping environment. Our premises are large, the aisles are wide and the shelves are low. Whenever we can, we choose locations where customers can park. We do not engage in aggressive and expensive advertising campaigns. Our products and prices speak for themselves, so we let our customers spread the word.
OUR ORGANISATIONAL STRUCTURE Our business is structured in line with our formula: simple and straightforward. Action has a flat organisational structure with a small head office and limited overheads to provide optimal support to our country organisations and our stores. At our international headquarters in Zwaagdijk, the Netherlands, a team of professionals is working on the execution of Action’s expansion strategy. Our HQ works as an expertise centre for all departments and functions, including HR, IT, Finance and Marketing. Our buying team, based in Zwaagdijk, is active around
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the globe. In France, Germany and Belgium, our country offices offer support to the stores, primarily with customer service, acquisition of new locations, and HR & recruitment. With three distribution centres in the Netherlands and France, and two more due to open in 2017 in France and Germany, Action is well positioned to stock its stores in a swift, efficient and sustainable manner. Over the past years, Action has transformed into a truly European retailer, with a healthy geographical diversification.
900
900
850
850
GROWTH IN NUMBER OF STORES 800
800
750
750
700
700
650
650
600
600
550
550
500
500
450
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400
400
350
350
300
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150
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50
50
0
1993
1994
1995
1996
1997
1998
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
2011
2012
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2014
2015
2016
THE NETHERLANDS BELGIUM GERMANY FRANCE LUXEMBOURG AUSTRIA
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& NIG
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43x
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X I BILIT
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43x
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Teddycare is our range of baby care products, specially developed for caring parents. If you want the best quality for your new-born at an affordable price, you can choose from a range that includes nappies, shampoo, oil and baby wipes.
4-9 kg
MIDI
3
Ziki is the trendy Action brand offering a colourful range of underwear and socks, made from stretch cotton to provide a perfect fit.
For the real handyman, Action has introduced the Werckmann brand, a range of quality tools and appliances characterised by strong orange and black branding.
SOME OF OUR PRIVATE LABELS 1 EN 43x Midi diapers
4-9 kg
3 MIDI
• Dermatologically tested: these diapers are dermatologically tested and have a soft feeling. • Freedom of movement: the anatomical shape and thin absorbent core are following the natural shape between the legs and allowing a great freedom of movement. • Day & night protection: the super absorbent core locks the liquid very fast and prevents moisture from affecting the baby’s skin. • Anti-leakage: the anti-leak barriers prevent leakages around the legs. • Perfect fit: the elastic ears and multi-fastening velcro tapes allow a perfect adjustment to the baby’s body at any time. • Chlorine free / Latex free / Perfume free • Breathable materials Attention: keep this bag out of the reach of babies and children to avoid any risk of suffocation.
1 NL 43x Midi luiers
• Dermatologisch getest: deze luiers zijn dermatologisch getest en voelen zacht aan. • Bewegingsvrijheid: de anatomische vorm en ultra dunne absorberende kern volgen de natuurlijke vorm tussen de beentjes en garanderen een grote bewegingsvrijheid. • Dag & nacht bescherming: de super absorberende kern houdt de vloeistof vast en houdt vocht weg van het babyhuidje. • Anti-lekkage: de anti-lekrandjes zorgen voor extra bescherming ter voorkoming van lekkage ter hoogte van de beentjes. • Perfecte fit: de elastische oren en hersluitbare klittebandsluitingen zorgen voor een perfecte pasvorm rond het lichaam van uw baby op elk moment van de dag of nacht. • Zonder chloor / zonder latex / zonder parfum • Ademende materialen Aandacht: om verstikkingsgevaar te vermijden, hou deze zak uit de buurt van baby’s en kinderen.
1 FR 43x Midi couches
• Testé dermatologiquement : ces couches, au toucher coton, ont été testés dermatologiquement. • Liberté de mouvement : le coussin absorbant ultra fin s’adapte parfaitement au niveau de la taille, des cuisses et de l’entrejambe de votre bébé. • Protection jour & nuit : le coussin absorbant retient le liquide et tient l’humidité éloignés de la peau de votre bébé. • Anti-fuite : les barrières anti-fuites procurent une protection renforcées contre les fuites tout au long de la journée et de la nuit. • Ajustement parfait : les côtés extensibles et les attaches velcro multi-fixations permettent un ajustement parfait à tout moment de la journée et de la nuit. • Sans chlore / Sans latex / Sans parfum • Micro-aéré Attention : tenir le sac hors de la portée des bébés et des enfants afin d’éviter tout risque d’étouffement.
1 DE 43x Midi Windeln
JUNIOR 11-25 kg
5
• Dermatologisch geprüft: diese Windeln sind dermatologisch getestet und extra weich. • Optimale Bewegungsfreiheit: der anatomische, der natürlichen Beinform des Babys angepasste Schnitt des ultra dünnen Saugkissens garantiert optimale Bewegungsfreiheit. • Tag- und Nachtschutz: der super saugfähige Kern schließt die Flüssigkeit schnell ein und hält sie zurück um Babyhaut vor Nässe zu schützen. • Auslaufschutz: flexible Bündchen verhindern das seitliche Auslaufen an den Beinchen. • Perfekter Sitz: die flexiblen Seitenteile und wiederverschließbaren Klettverschlüsse sorgen Tag und Nacht für einen perfekten, dem Babykörper genau angepassten Sitz. • Chlorfrei: der Zellstoff der Windeln wurde natürlich gebleicht, ohne Chlor. • Latexfrei / Parfümfrei • Atmungsaktiv Achtung: um Erstickungsgefahr zu vermeiden, Beutel außer Reichweite von Babys und Kindern aufbewahren.
1 CZ 43x Midi Plenky
• Dermatologicky testované: tyto plenky jsou dermatologicky testované a jsou příjemně měkké. • Volnost pohybu: anatomický tvar a ultra tenké jádro jsou vyvinuty v souladu s přirozeným tvarem mezi nožičkami a umožňují volnost pohybu. • Ochrana během dne i noci: super absorpční jádro velmi rychle uzamyká tekutinu uvnitř plenky a zabraňuje, aby vlhkost působila na dětskou pokožku. • Ochrana před protečením: bariéry vytvářejí ochranu před protečením v oblasti okolo nožiček. • Skvěle padnoucí: elastické postranní pásky a lepítka pro opakované použití umožňují idealní přizpůsobení dětskému tělíčku kdykoliv během používání plenky. • Bez chlóru: celulóza pro výrobu plenek je bělená přírodní cestou bez použití chlóru. • Bez latexu / Bez parfému • Prodyšné materiály Upozornění: uchovávejte obal mimo dosah dětí, abyste předešli nebezpečí udušení.
soft toplayer & super absorbent core
multi-fastening velcro tapes
elastic ears
anti-leak barriers
ZD Trading Perenmarkt 15 1681 PG Zwaagdijk - Oost (NL)
breathable materials
ATOLOG M
CH IS
4
DER
We help our customers to create and celebrate special moments with a broad range of products, whether these are decorations for a party, stationary for the first day at school or garden and outdoor tools when spring arrives. Our product range consists of 13 categories: decoration, DIY (do it yourself), toys & entertainment, stationary & hobby, multimedia, household goods, garden & outdoor, laundry & cleaning, food & drink, personal care, pet, fashion and linens. MAXI 7-18 kg
But value is more than just the lowest price. It also stands for products that perform as expected. Our customers can trust that our low prices never reflect corner cutting. Despite the low prices of our articles, we make no concessions when it comes to quality, safety and responsibility. Action’s buying team sources from over 400 suppliers, most of which are based in Europe and Asia. We form partnerships with our suppliers to ensure a collaborative approach to responsible sourcing. Thanks to this approach, we can
Our goal to surprise is part of who we are and how we succeed. Our priority is to lead on price and differentiate on surprise, enabling Action to offer our customers everyday products at affordable prices.
IMPORTANT When Pantone colours are used, the colours must be matched with the official Pantone guide. OFFSET
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LETTER PRESS
SILK SCREEN
GRAVURE
FLEXO
8718964015085
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printprocess Coated PMS PMS 7467 C
In each of our stores, we offer a varied range of over 6,000 lowest priced everyday products. More than 60% of our product range is variable and changing. Action aims to provide value by offering the unexpected: a shopping experience with an element of surprise. We introduce more than 150 new products on a weekly basis.
PMS 116 C
Uncoated PMS Y
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assure our customers that we offer products that meet strict legal requirements in every country we operate in. Together with our suppliers, our buyers are always on the look-out for quality products at affordable prices, pleasantly surprising our customers each time they visit us. Action products, such as our powerbank, regularly score best in consumer tests. C
M
used colours
projectnumber client description product last adjustment
44.16.019 Action Luiers Luier Midi 30-08-2016
projectmanager designer
Nancy van der Lubbe Lisanne Snoek
scale print software fonts
100% Adobe CC The fonts added may only used for this project
Yellow Dress Retail Nieuwendammerdijk 538 1023 BX Amsterdam +31 (0)20 632 02 40 www.yellowdressretail.com
Our range of products includes A-brands and private label articles. We continue to invest in our own brands, which are produced exclusively for Action, according to our requirements and specifications. We offer exciting product ranges like Teddycare, part of our personal care assortment and our Werckmann quality tools range in the DIY segment. In 2016, we introduced several new Action brands, such as Sensabelle underwear and Eliza Jones skin care products.
OUR PRODUCTS
SOCIAL RESPONSIBILITY: ACTION! As a retailer, serving millions of customers in more than 850 stores across six countries, we are well aware of what society demands from us. Governments, agencies and regulators set the regulatory framework in which we operate, providing rules and regulations affecting all aspects of our business, from plastic bags to logistics and energy audits. But we believe that our responsibility extends beyond compliance with these rules and regulations. As a rapidly expanding business with a global supply chain, our impact on society and the environment is increasing. We are therefore responsible for ensuring sound ethical and environmental practices covering our operations, throughout our supply chain and in the communities in which we operate. Our customers expect this from us: they should not be confronted with ethical or environmental issues impacting Action or the products it offers. We define our social responsibility in our Action Social Responsibility (ASR) strategy. At Action, this means doing business while respecting human rights, trading ethically and protecting the environment. We take responsibility for sound ethical and environmental practices in our operations, as well as in our supply chain. Our Social Responsibility strategy is a roadmap that helps us focus our actions over time.
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What we believe Offering quality products at low prices requires our dedication to safety and transparency on products, operations, the environment and people. We realise that growth comes with continuous improvements across our activities.
For each of these building blocks, there is a clear owner in our management team, each supported by their own line management for the actual implementation. The overall responsibility for the Action Social Responsibility strategy lies with our CEO.
The building blocks of our strategy Our Action Social Responsibility strategy has four building blocks, each closely related to our business.
PRODUCT
Our products are safe and responsibly sourced
PEOPLE
We are a responsible employer
ENVIRONMENT
We minimise our environmental impact across the supply chain
GOOD CITIZENSHIP
CEO
We contribute to society and serve local communities
Sander van der Laan
PRODUCT
PEOPLE
ENVIRONMENT
GOOD CITIZENSHIP
Buying & Merchandising Director Simon Hathway
HR Director
Supply Chain Director Vincent Bröring
Operations Director Hajir Hajji
Liz van der Werf
On the following pages, we will outline our approach and results for each of these building blocks.
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OUR PRODUCTS ARE SAFE AND RESPONSIBLY SOURCED Our approach At Action, we collaborate closely with over 400 domestic importers. And we buy from A-brand suppliers. We have also started a direct import program to buy from the source. In 2016, we sourced directly from over 300 manufacturers, representing more than 10% of our volume. Approximately 40% of our products come from suppliers that are based in Europe, with the remaining 60% coming from Asia. We take responsibility across our supply chain. The products we offer are safe and responsibly produced. We form partnerships with our suppliers to ensure a collaborative approach to responsible sourcing. A pre-requisite for doing business with Action is that our suppliers comply with our Ethical Sourcing Policy which ensures customers can shop at Action with peace of mind. To support our suppliers, we have created an Ethical Sourcing Supplier Manual, which includes the consequences of failing to live up to this Policy. The key elements of our Ethical Sourcing Policy stem from the International Labour Organisation conventions, the Ethical Trading Initiative base code, the UN Guiding Principles on Business and Human Rights and the Business Social Compliance Initiative Code of Conduct. We created our policy and rolled it out across our existing suppliers. All new suppliers are required to commit to the Ethical Sourcing Policy as part of our agreement with them.
Action’s Ethical Sourcing Policy includes the following requirements: • Employment is freely chosen • Freedom of association and collective bargaining • No child labour is used • No discrimination is practiced, • No harsh or inhumane treatment • Fair wages are paid • Working hours are not excessive • Safe and hygienic working conditions are provided • Protection of the environment • Regular employment is provided • Principles of implementation in full compliance with Action’s Ethical Sourcing Policy To oversee responsible business practices and quality of our suppliers, we have people on the ground in Asia. For example, our partner Li & Fung has a dedicated team of 60 people working closely with our suppliers. Results to date By the end of 2016, all direct suppliers agreed to implement the Ethical Sourcing Policy. Their operations have been audited to ensure that the Ethical Sourcing Policy is adhered to. Furthermore, by the end of 2016, each of our domestic import suppliers has committed to our Ethical Sourcing Policy. In 2016, we increased our product offering of sustainably certified products (organic, eco, fair trade, etc.) to almost 700 products.
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WE ARE A RESPONSIBLE EMPLOYER Our approach Our people bring Action to life, every day, in every community in which we operate. As Action continues to grow, we continue to offer jobs to people of every age, educational level and background. Every store or distribution centre we open creates new jobs. The activities and motivation of our colleagues also depend on the inspiration we provide them. At Action, we really care about our employees and we celebrate diversity. Our workforce represents the diversity of our customers in terms of cultural background, gender and age. We help our employees to grow through training and development programmes. We provide them with promotion opportunities whenever we can. We implement responsible and respectful leadership at different levels in the organisation.
Results to date By the end of 2016, Action employed 35,000 people. In 2016, we created almost 6,000 new jobs in the six countries in which we operate. Our workforce includes many nationalities and has a broad range of ages, educational levels and backgrounds. In 2016, we hired individuals with disabilities or other factors which might prevent them from effectively participating in the labour market. Our distribution centres in Zwaagdijk and Echt in particular offer ample opportunity for these employees. Many of them stay with the business. In France, Action collaborates with the organisation Pôle L’emploi, creating employment or individuals facing difficulties accessing the labour market. At Action, we train and develop our employees from day 1, upskilling them to handle everyday tasks and situations and developing skills such as leadership which supports
overall development and progression. In 2016, we made a significant investment in the Action Academy, providing training and development programs to support the growth of our employees. We had more than 10.000 training days in 2016. As a result, many employees could be promoted. For example, in 2016, 135 of our assistant store managers were promoted to store manager. By the end of the year, 63% of our store managers were women. In 2016, we also trained the staff in our stores and our truck drivers on dealing with aggressive and violent behaviour. For this program, Action has been nominated for the European Excellence Awards in HR in the category ‘Corporate Social Responsibility’. We conduct our employee satisfaction survey, the Voice of Action, every other year. We are proud that our most recent employee engagement score (in 2015) was well above the average, both nationally and for the retail sector. In 2015, we had a very high response rate of 93%.
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WE MINIMISE OUR ENVIRONMENTAL IMPACT ACROSS THE SUPPLY CHAIN Our approach We take responsibility for the environmental impact our operations have across our supply chain.
Results to date We have found that care for the environment and cost savings often go hand in hand.
As the number of stores continues to grow, we invest in additional distribution centres in central locations. These distribution centres use electric transport to limit CO2 emissions and to reduce noise and exhaust levels onsite.
With our fleet of more fuel-efficient and double-decker trucks, plus the training for our drivers, we have saved 35% on fuel and CO2 emissions. We have 341 double-deckers which result in a 60% extra load of our trucks. Action started a special mentoring program for the truck drivers to coach them on how to drive safely and save fuel.
We use an innovative and fuel-efficient fleet to transport products from these distribution centres to our stores. We are upgrading our fleet by adding more fuel-efficient engines. Our innovative double-decker trucks can carry 60% more cases than conventional trucks. In addition, we train our drivers to drive responsibly – taking proper care of safety, fuel-use and the trucks. All our new stores are fitted with energy-efficient lighting. We collect and separate packaging materials, as well as other waste in all of our stores. We also encourage our customers to recycle. In the Netherlands, we offer WeCycle recycling bins for electrical equipment, batteries and light bulbs. Our own trucks take the separated waste streams back to the distribution centres. From there, we sell the cardboard and plastic to recycling companies and properly dispose of all other waste.
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In 2016, we again broke our internal recycling record. We recycled 83% of our plastic and cardboard from within our stores and helped our customers to recycle 82.645 kilos of batteries, electrical equipment and light bulbs. For comparison, this was 18,7% more than in 2015.
WE CONTRIBUTE TO SOCIETY AND SERVE LOCAL COMMUNITIES Our approach Our stores contribute to the local livelihood in shopping centres in the towns and cities in which we operate. We are dedicated to keeping our shopping area clean and well maintained. We create traffic to our own stores, but also to other stores in the area. This happens through the opening of new stores, but also through extended opening hours, for example on Sundays. With our low prices, we provide access to ordinary and extraordinary products for every budget. We also offer support to people in need in our communities. We do this with a focus on children, as we believe children are the future. Since 2012, we have been collaborating with the National Children’s Aid Fund (Nationaal Fonds Kinderhulp). This foundation supports children growing up in poverty, which involves over 400,000 children in the Netherlands.
Results to date Since the start of our collaboration in 2015, Action donated € 128,000 in cash and 4.664 packages in goods to the National Children’s Aid Fund in the Netherlands. Through this fund, we supported children living in poverty. We donated boxes filled with home decorations to young adults about to leave home. And we offered backpacks filled with school materials to children of all ages to help them learn. The Children’s Aid Fund and many of their partners shared pictures and anecdotes of these children on social media.
Action actively participated in the “Serious Request” fundraising drive for the Red Cross, which focused on child mortality due to pneumonia. A young, terminally ill boy joined the campaign by applying nail polish for a small fee. His idea was picked up by national and social media and became a campaign “Heel Holland Lakt” (all of Holland polishes). It resulted in a contribution of €1.5 million to the Red Cross. All Dutch Action stores participated in “Heel Holland Lakt”. Action donated a total of €18,000 to this campaign. We donated our used IT equipment to ITdonations, which sells it. The proceeds of € 26,000 were donated to KiKa, a foundation that raises money for research on children’s cancer.
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GOVERNANCE
PRINCIPLES RELATING TO TAX
Action is committed to a sound governance structure and running its business with integrity. We firmly believe that transparency contributes to Action’s success. Our governance structure reflects how the company is managed and controlled, taking into account the interests of all relevant stakeholders. Our key shareholder 3i, a UK listed company, is a renowned private equity firm and provides Action with comprehensive knowledge, retail expertise and access to its international business network. Action has a one-tier board structure, consisting of a Board of Directors and an Executive Board, comprising Action’s key operational functions. The Executive Board is responsible for implementing Action’s strategy and
day-to-day operations. The non-executive directors within the Board supervise the Executive Board and the general course of affairs. The Board has established an Audit Committee and a Selection, Nomination and Remuneration Committee. Both committees assist the Board in the discharge of its responsibilities.
Action is a responsible retailer in everything it does and stands for, also when it comes to payment of taxes arising from its business activities, i.e. all direct and indirect tax charges, including import duties, corporate income tax, VAT, payroll and other taxes applied by any relevant tax authority.
Although Action is not required to be compliant with the Dutch Corporate Governance Code, the company embraces its key principles. Action is currently implementing a code of conduct and a whistle-blower policy, with the use of a dedicated Alert-line. Action has established a dedicated risk management and internal audit function, centrally organised within Risk Assurance, a group function.
It considers its tax paying behavior an integral part of its social responsibility in running a sustainable and responsible business. Action’s approach to tax seeks to balance the various interests of its shareholders, relevant governments, its employees and the communities in which it operates.
OUR MANAGEMENT
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Sander van der Laan CEO
Frederik Lotz CFO
Hajir Hajji Operations Director
Simon Hathway Buying & Merchandising Director
Action maintains the following principles when it comes to taxation: 1. We act responsibly in relation to our tax affairs and aim to achieve this by complying with applicable tax laws and regulations. 2. We are transparent about our profits and make our tax payments in a timely manner. 3. We aim to develop strong and constructive relationships with national authorities where we operate, based on mutual transparency and trust. 4. We maintain the appropriate mechanisms and controls to apply these principles across the business.
RISK MANAGEMENT Growing comes with risks. Therefore Action has significantly invested in risk management. Within Action, we define risk management as the process of understanding and managing the risks that Action inevitably faces in achieving its growth ambition. A structured approach to risk management, risk awareness and risk management practices are essential in a fast-growing organisation like Action to create and preserve long-term value. To realise our expansion plans going forward, we focus on a simple, scalable and cost-effective business model to strengthen our unique customer value proposition and to further expand internationally. The objective of our risk management approach is to identify and assess all the main risks that may prevent us from achieving our strategic, financial and/or operational objectives. Action has a prudent approach to risk management. The definition of our risk margins is driven by our ambitions, values and group policies. The simplicity of our business model forms a shield against risk: we go for the simpler solutions.
OUR KEY FINANCIAL FIGURES Roles and responsibilities for risk management, risk oversight and internal audit are clearly defined and separated from Action’s commercial and operational activities. Our ‘three lines of defence’ model helps us to pro-actively identify and report risks:
• First line of defence: Identify, assess and manage risks in the businesses with deep risk expertise. • Second line of defence: Covers a variety of control functions, including strategic, tactical and operational risks, ranging from culture and values to business format and product related risks to information security, business continuity, fraud, integrity and compliance risks. • Third line of defence: Provides independent and objective assurance activities, designed to add value and improve the effectiveness of Action’s risk management, internal control and compliance procedures and governance.
Totale Salesomzet (EUR (EURmiljoen) million)
2,675
2,800 2,400
1,600 1,200 800
873
1,155
1,506
400 0
2012
2013
2014
We continue to drive improvements to our risk management process and the quality of risk information generated, while at the same time maintaining a simple and practical approach. As a result, we have placed significant focus on developing and strengthening our risk management framework for our operations and have performed our first internal audits. With a solid base to make business decisions, in combination with our current approach to risk management and our progress to date, we are confident that we will achieve our objectives going forward.
2015
2016
* Operating EBITDA Operating EBITDA (EUR miljoen) (EUR million)
310
320 280
200 160 120
37%
226
240
Facilitated by our Risk Assurance team, we initiated a structured approach to the identification and assessment of the main strategic risks for our business, involving Executive Board members and functional directors across our organisation. We believe that the results from this assessment have greatly strengthened the robustness of our strategic plans.
34%
1,995
2,000
99
129
2012
2013
166
80 40 0
2014
2015
7.2%
7.6%
2014
2015
2016
A Like for Like growth
12
9.6%
10 8
7.0%
6.9%
6 4 2 0
2012
2013
2016
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WHERE TO FIND US The Netherlands Head Office and Distribution Centre Zwaagdijk Perenmarkt 15 1681 PG Zwaagdijk-Oost Distribution Centre Echt Fahrenheitweg 1 6101 WR Echt Belgium Country office Gentsesteenweg 120 1730 Asse Germany Country office Schirmerstrasse 76 40211 Düsseldorf Distribution Centre Biblis Beim Kreuz 2 68647 Biblis France Country office 18-26 rue Goubet 75019 Paris Distribution Centre Moissy-Cramayel Prologis Park Moissy 2 1754 Avenue Paul Delouvrier 77550 Moissy-Cramayel
